Overview
Sensitive Industries (SI) rules monitor investments in industries that a jurisdiction considers strategically important. Each jurisdiction defines its own sensitive industries and thresholds.
Common examples include:
Banking and Finance
Media
Gas and Electricity Utilities
Air Freight and Logistics
Airlines
Telecommunications
Insurance
Typical Thresholds
Sensitive Industries thresholds vary by jurisdiction and industry. Some jurisdictions impose an absolute restriction on investment, while others apply specific thresholds only to foreign investors (e.g. Japan).
See the lowest Sensitive Industries thresholds by jurisdiction for more information.
Frequently Asked Questions
Q. How does Sensitive Industries work?
A. We source SI thresholds from aosphere. These thresholds are represented in your environment through SI value sets. There are three levels of SI thresholds:
Threshold Disclosure - after this threshold is crossed, disclosure is required.
Pre-Approval - before crossing this threshold, approval is required from the appropriate party in that jurisdiction.
Hard Stop - this threshold is a limit that cannot be crossed.
In some cases, depending on the jurisdiction where the value set is used, there are jurisdiction-specific variants of the above types. (see, What are “Foreign” rules, below).
The Sensitive Industries rules then compare a given issuer's industry against the thresholds in the SI value sets.
Any results are flagged according to the relevant SI threshold.
Q. What are “Foreign” rules?
A. There are rules that only apply to investors domiciled in a country considered foreign to the jurisdiction with sensitive industries (i.e., they exclude domestic investors). We have implemented a precondition in such rules to capture this.
They are named to indicate so, for example, Sensitive Industries: Canada - Foreign - Hard Stop.
They occur where the aosphere memo indicates that certain thresholds apply only to foreign investors.
There is a Domicile entity property that determines whether the top entity is “foreign” under Foreign rules. This should be populated with an ISO country code for the top entity where SI rules are run.
If Domicile is not provided, the rules will conservatively deem the entity “foreign” for any foreign rules we create.
These rules otherwise operate according to the same structure as other SI rules (Threshold Disclosure, Pre-Approval, Hard Stop).
Q. What information needs to be provided for Sensitive Industries?
A. For clients currently subscribed to the Shareholding Disclosure service, one additional property is required for SI to run.
This property is GICSSubIndustries (i.e., the GICS code), which refers to the Global Industry Classification Standard. The GICS code is an 8-digit code used to define the sub-industry or sub-industries an issuer operates in. This code is matched against the list of industry thresholds.
If a security’s issuer does not have a GICS Code, you may choose to set the input value to "XXXXXXXX" to prevent Unknown alerts from being triggered. However, this means that such positions will not be included in any Sensitive Industries rules.
Q. Can GICS codes be easily sourced for us in some way?
A. Yes! We are a redistributor of GICS codes directly from S&P and can integrate them directly into your files; please contact your account manager or our Support team.
Q. How can I enable Sensitive Industries?
A. The SI rule package involves a subscription fee. If you have any questions about SI or are interested in a demo, please contact your CSM or Support.
Q. Which jurisdictions are covered by Sensitive Industries?
A. You can find the latest list here.